19th July - Weekly FX Update

GBP/EUR: Monday 9:00 UTC 19th July: 1.16462

Last week, UK inflation jumped to its highest level since August 2018, with soaring fuel and oil prices. The rise however was widespread, according to Jonathan Athow of the ONS, from price increases for food to second-hand cars. GBPEUR quickly rose to 1.17549, its highest level since early April. Another boost for Sterling last week was UK employment figures. Released to the public last Thursday, the unemployment rate dropped to 4.8%, with Rishi Sunak expressing some optimism for the UK's economic recovery as the final stages of reopening are approaching. Despite these positive data releases, the Pound gave up gains to the Euro heading into this week. Covid-19 cases have soared over the last few weeks, with many doctors and health experts raising their issues with the 19th July reopening. Looking ahead, GBPEUR could go lower after failing to hold gains above 1.17. Thursday will see the ECB interest rate meeting and press conference, which will give some insight into how Christine Lagarde, the ECB President, will handle rising inflation in the Eurozone. UK Covid-19 cases will also play a huge part in the strength of the Sterling against other major currencies.

GBP/USD: Monday 9:00 UTC 19th July: 1.37078

The Dollar struggled last week after Fed Chair Jerome Powell's testimony revealed the US economy was still "way off" the levels needed to taper its monetary support. These comments followed US inflation accelerating more than expected in June, which signals the highest rise since July 2008. Today the restrictions are ending in the UK, despite Covid-19 cases rising rapidly. This has certainly loomed over the Pound, with it dropping sharply against the Dollar on Friday. This morning, the rate fell to its lowest level since February at 1.37045. UK leaders are once again self-isolating as Health Secretary Said Javid tested positive for Covid-19 on Saturday. Looking ahead, there will be little to talk about in the UK economic calendar, while the US building permits and housing starts for June will be released tomorrow. Investors will be keeping a close eye on rising UK Covid-19 cases in wake of a full economic reopening.

Recent Posts

See All

2nd August - Weekly FX Update

GBP/EUR: Monday 9:00 UTC 2nd August: 1.17101 The GBPEUR exchange rate was trading at April highs last week, after the release of German unemployment and inflation data. German inflation was the highes

26th July - Weekly FX Update

GBP/EUR: Monday 9:00 UTC 26th July: 1.16826 The GBPEUR rate rallied last week after reaching lows of 1.15345 on Tuesday, as Covid-19 cases soared. The UK has since seen a dip in virus cases, after rep

12th July - Weekly FX Update

GBP/EUR: Monday 9:00 UTC 12th July: 1.16762 The UK economic recovery slowed in May, with growth coming in at 0.8%. Moreover, renewed Brexit concerns and surging Covid-19 cases capped off gains for the